Decentralizedย financeย (DeFi) protocol Synthetix could potentially burn a wholeย lotย of percentage of its supply if the project moves forward with a proposition from its founder.
In a new blog update, Synthetix founder Kain Warwick lays out 12 different suggestions or opportunities for the project moving forward.
1 of Warwickโs 12 points includes a 3:1 split of SNX and a buyback and burn function. Althoughย while Synthetix still requires some inflation for incentives and liquidity for pools, Warwick reveals a buy-and-burn feature could still be useful.
โEven if inflation is the only solution here, I doย not think it negates having a countervailing force of buy-back and burn. If we do a 3:1 split we would have around 90m additional cryptoย tokens to buy back and burn with a marketย value of $60 Million. Where does the money come from to burn these tokens? Treasury fee yield.
Accordingย to recent yield the Treasury Council (TC) is earning around $5m per year, if 100 percent of this is allocated to buybacks it would take about 10 years to complete. If volumeย ofย trading increases over theย following few years this timeline would be reduced significantly.โ
Warwick mentioned that the idea isย still just conceptual, and nothing has been confirmed by a Treasury Council vote.
Synthetix is a protocol that allows for synthetic assets to be announced for trading on Ethereumย (ETH). 1 of the top platforms powered by Synthetix is Kwenta.io, which allows for trading digitalย currencies, fiat currencies, and other assets with leverage in a decentralized manner.
Synthetix recently launched support for Pepe Coin (PEPE), Sui Network (SUI), Blur, XRPย Rippleย (XRP), Polkadotย (DOT), Floki Inu (FLOKI), and Injective Protocol (INJ) perpetual contracts (perps). Reportsย by the project, over 40 perps are now available for trading.
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